1.5K views · 12 reactions | Difference between a sole proprietor & LLC | Irvin Peña | Facebook
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Both of them earned $100k. But one keeps more money than the other. The difference is having your LLC taxed as an S-corp VS sole proprietor. By electing to be taxed as an S-Corp, you can split your earnings between a paycheck and an owner's draw. This allows you to minimize self-employment taxes, paying $0 on the owner's draw portion. But it doesn't make sense until you are taking home more than $100k. because it costs money to setup and manage (payroll, LLC etc) So when you are taking home more
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